Category: BestPractice

Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [D-F]

Volatility clustering plots for stocks with yahoo.finance tickers from D to F. Continue reading "Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [D-F]"

Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [A-C]

Volatility clustering plots for stocks with yahoo.finance tickers from A to C.
Continue reading "Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [A-C]"

Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [0-9]

We continue publishing the visualized results from Vasily Nekrasov's research. Reportedly, when Warren Buffett happens to hear complains that there are thousands of stocks to scrutinize, he says "well, start with letter A". We go even further and start with digit 0, since there are (were) suchlike tickers by yahoo.finance. Continue reading "Volatility Clustering and Piecewise Homoscedasticity – Part II – 2940 stocks – [0-9]"

Volatility Clustering and Piecewise Homoscedasticity – Part I – Indices

This is a well-known fact that the stock prices are virtually unpredictable. However, stock volatilities can more or less be forecasted! In 2012 Vasily Nekrasov scrutinized about 3000 asset price time series, obtained from yahoo.finance. Approximately in half of cases the volatility was piecewise-stationary and thus predicatable. We put online the technical record from 2012 and start publishing the visualized results Continue reading "Volatility Clustering and Piecewise Homoscedasticity – Part I – Indices"

Should I use a Trading Simulator to learn how to trade?

Have you ever thought of being a trader?
I mean trading things like stocks, currencies, options or anything else that you can buy and sell almost instantly - typically online - by pressing a button and not illiquid assets, such as houses or antique furniture.
Wouldn’t it be great to get some sense of what real world trading looks like before setting up an account with an online brokerage firm and putting your own money on risk? Continue reading "Should I use a Trading Simulator to learn how to trade?"

Oh This Cranky Sentiment: General Electric vs. Daimler on 20.10.2017

Virtually every trader and investor is aware about technical and fundamental analysis. But little understand the importance of sentiment. We consider a case study of GE vs DAI, which particularly good illustrates the importance and interaction of these three components. Continue reading "Oh This Cranky Sentiment: General Electric vs. Daimler on 20.10.2017"

Numeracy for Traders – Lesson 3 – Ode to Deferred Withholding Tax

Many investment funds and financial services that want your money argue with a deferred capital yield tax. For instance, in Germany if you trade by yourself, you immediately pay the capital returns tax [Kapitalertragsteuer]  (unless the net result of your previous trades is negative). But if you invest in a fund, you don't pay the tax on returns until you sell your share (you still pay a tax on dividends).
We show that though, in general, an investor profits from tax deferral, one should not exaggerate its effect. Moreover, due to annual tax-exempt amounts [Jahresfreibetrag], an immediate taxation can be better than a deferred one. 
Continue reading "Numeracy for Traders – Lesson 3 – Ode to Deferred Withholding Tax"

DeGiro – [aktuell] der Beste Broker

DeGiro hat unschlagbar niedrige Gebühren, insb. wenn man mit kleinen Beiträgen handelt. Darüber hinaus gibt es über 200 ETFs, welche man ganz ohne Kosten (allerdings nicht unbegrenzt häufig) handeln kann. Dazu kann man unkompliziert short gehen und mit den Optionen direkt auf EUREX handeln. Last but not least geht die Ameldung sehr schnell und ohne Post- bzw. PhotoIdent und die Konto-Statistik wird in echter Zeit erstellt.
Die Nachteile von DeGiro sind aktuell wie folgt: zusätzliche steuerliche Belastung der Dividende durch die Quellensteuer, kein Zugriff auf außerbörslichen Direkthandel und Börse Stuttgart, sowie limitierte Einlagensicherung.
Continue reading "DeGiro – [aktuell] der Beste Broker"

Einstein’s rating agency: easy and clear for everyone

Recently we revied the performance of Einstein, a German trader who managed (without a leverage) to make almost 2000% in less than three years. LetYourMoneyGrow.com translates his investment grades in layman's terms:

  1. Tenbagger - the stock will grow ten times within 3 years.
  2. Doubler - the stock will grow twice with a year
  3. Outperformer - the stock will be better than peer group by factor 2
  4. Money - one may but not necessarily need to buy the stock
  5. No-hoper - one will neither lose nor earn money with this stock
  6. Pinocchio - the board does not get along with the truth
  7. Brief - one may but not necessarily need to sell the stock short
  8. Short - one can earn money if sells this stock short
  9. Snot - avoid buying this stock, do sell it short!
  10. Snot to the power of 10 - target zero, total loss, blacklist and megashort!